SOURCE: The provisions of this Part 870 appear at 35 Fed. Reg.
8226, May 26, 1970, except as otherwise noted.

Subpart AGeneral

§ 870.1 Purpose and scope.

(a) This part sets forth the procedures and any policies,
determinations, and interpretations of general application whereby the
Secretary of Labor carries out his duties under
section 303 of the CCPA dealing
with restrictions on garnishment of earnings, and
section 305 permitting exemptions
for State-regulated garnishments in certain situations. While the
Secretary's duties under section 303 include insuring that certain
amounts of earnings are protected, such duties do not include
establishing priorities among multiple garnishments, as such priorities
are determined by other Federal statutes or by State law.

(b) Functions of the Secretary under the CCPA to be performed as
provided in this part are assigned to the Administrator of the Wage and
Hour Division (hereinafter referred to as the Administrator), who,
under the general direction and control of the Assistant Secretary,
Wage, and Labor Standards Administration, shall be empowered to take
final and binding actions in administering the provisions of this part.
The Administrator is empowered to subdelegate any of his duties under
this part. Any legal advice and assistance required for administration
of this part shall be provided by the Solicitor of Labor.

[Codified to 29 C.F.R. § 870.1]

[Section 870.1 amended at 44 Fed. Reg. 30684, May 29,
1979]

§ 870.2 Amendments to this part.

The Administrator may, at any time upon his own motion or upon
written request of any interested person setting forth reasonable
grounds therefor, amend any rules in this part.

(a) Statutory
provision. Section 303(a) of
the CCPA provides that, with some exceptions,

the maximum part of the aggregate disposable earnings of an
individual for any workweek which is subjected to garnishment may not
exceed

(1) 25 per centum of his disposable earnings for that week, or

(2) the amount by which his disposable earnings for that week
exceed thirty times the Federal minimum hourly wage
prescribed by section 6(a)(1) of the Fair Labor Standards Act of 1938,
in effect at the time the earnings are payable.

whichever is less. In the case of earnings for any pay period
other than a week, the Secretary of Labor shall by regulation prescribe
a multiple of the Federal minimum hourly wage equivalent in effect to
that set forth in paragraph (2).

(b) Weekly pay period. The statutory exemption formula
applies directly to the aggregate disposable earnings paid or payable
for a pay period of 1 workweek, or a lesser period. Its intent is to
protect from garnishment and save to an individual earner, the
specified amount of compensation for his personal services rendered in
the workweek, or a lesser period. Thus;

(1) If an individual's disposable earnings for a workweek or
lesser period are $79.50 (30 × $2.65) or less, his/her earnings may
not be garnished in any amount. The amount which may not be garnished
is 30 times the Fair Labor Standards Act minimum wage. When the minimum
wage increases, this amount will also increase. On January 1, 1979, the
minimum wage increases to $2.90, on January 1, 1980, it increases to
$3.10; and on January 1, 1981, it increases to $3.35. Accordingly, the
amount of disposable weekly earnings which may not be garnished will
increase to $87 on January 1, 1979; to $93 on January 1, 1980; and to
$100.50 on January 1, 1981.

(2) If an individual's disposable earnings for a workweek or
lesser period are more than $79.50, but less than $106, only the amount
above $79.50 is subject to garnishment. As the $106 figure is in fact
40 times the Fair Labor Standards Act minimum wage of $2.65, this
figure will increase to $116 on January 1, 1979; to $124 on January 1,
1980; and to $134 on January 1, 1981.

(3) If an individual's disposable earnings for a workweek or
lesser period are $106 or more, 25 percent of his/her disposable
earnings is subject to garnishment. As pointed out in subparagraph (2),
of this paragraph, the $106 figure is increased to $116 on January 1,
1979; to $124 on January 1, 1980; and to $134 on January 1, 1981.

(c) Pay for a period longer than 1 week. In the case
of disposable earnings which compensate for personal services rendered
in a pay period longer than 1 workweek, the weekly statutory exemption
formula must be transformed to a formula applicable to such earnings
providing equivalent restrictions on wage garnishment.

(1) The 25 percent part of the formula would apply to the
aggregate disposable earnings for all the workweeks or fractions
thereof compensated by the pay for such pay period.

(2) The "multiple" of the Federal minimum hourly wage
equivalent to that applicable to the disposable earnings for 1 week is
represented by the following formula: The number of workweeks, or
fractions thereof (X) × 30 × the applicable Federal minimum wage
($2.65). For the purpose of this formula, a calendar month is
considered to consist of 41/3 workweeks. Thus, so long as the
Federal minimum hourly wage is $2.65 an hour,
the
"multiple" applicable to the disposable earnings for a 2-week
period is $159 (2 × 30 × $2.65); for a monthly period, $344.50
(41/3 × 30 × $2.65); and for a semimonthly period, $172.25
(21/6 × 30 × $2.65). The "multiple" for any other pay
period longer than 1 week shall be computed in a manner consistent with
section 303(a) of the Act and with this paragraph.

(3) Disposable earnings for individuals paid weekly, biweekly,
semi-monthly, and monthly may not be garnished unless they are in
excess of the following amounts:

Date

Minimum
rate

Weekly amount

Biweekly amount

Semi-monthly
amount

Monthly amount

Jan. 1,
1978

$2.65

$79.50

$159.00

$172.25

$344.50

Jan. 1,
1979

2.90

87.00

174.00

188.50

377.00

Jan. 1,
1980

3.10

93.00

186.00

201.50

403.00

Jan. 1,
1981

3.35

100.50

201.00

217.75

435.50

(4) If the disposable earnings are less than the following
figures, only the difference between the appropriate figures set forth
in paragraph (c)(3) of this section and the appropriate figure of the
following figures may be garnished.

Date

Minimum
rate

Weekly amount

Biweekly amount

Semi-monthly
amount

Monthly amount

Jan. 1,
1978

$2.65

$106.00

$212.00

$229.67

$459.32

Jan. 1,
1979

2.90

116.00

232.00

251.33

502.67

Jan. 1,
1980

3.10

124.00

248.00

268.67

537.33

Jan. 1,
1981

3.35

134.00

268.00

290.33

580.67

For example, in January of 1978, if an individual's disposable
earnings for a biweekly pay period are $205, the difference between
$159 and $205 (i.e., $46) may be garnished.

(5) If disposable earnings are in excess of the figures stated in
paragraph (c)(4) of this section, 25% of the disposable earnings may
be garnished.

(d) Date wages paid or payable controlling. The date
that disposable earnings are paid or payable, and not the date the
Court issues the garnishment order, is controlling in determining the
amount of disposable earnings that may be garnished. Thus, a
garnishment order issued in November 1977, providing for withholding
from wages over a period of time, based on exemptions computed at the
$2.30 per hour minimum wage then in effect, would be modified by
operation of the change in the law so that wages paid after January 1,
1978, would be subject to garnishment during 1978 only to the extent
described in paragraphs (b) and (c) of this section on the basis of a
minimum rate of $2.65 per hour. This principle is applicable at the
time of each further increase in the minimum wage, i.e., January 1, of
the years 1979, 1980, and 1981.

§ 870.11 Exceptions to the restrictions provided by section
303(a) of the CCPA and priorities among garnishments.

(a)(1) Section 303(b) of the Consumer Credit Protection Act
provides that the restrictions in section 303(a) do not apply
to:

(i) Any debt due for any State or Federal tax, or

(ii) Any order of any court of bankruptcy under Chapter XIII of
the Bankruptcy Act.

(2) Accordingly the Consumer Credit Protection Act does not
restrict in any way the amount which may be withheld for State or
Federal taxes or in Chapter XIII Bankruptcy Act proceedings.

(b)(1) Section 303(b) provides the following restrictions on the
amount that may be withheld for the support of any person (e.g. alimony
or child support):

"(A) Where such individual is supporting his spouse or
dependent child (other than a spouse or child with respect to whose
support such order is issued), 50 per centum of such individual's
disposable earnings for that week; and

"(B) Where such individual is not supporting such a spouse or
dependent child described in clause (A), 60 per centum of such
individual's disposable earnings for that week; except that, with
respect to the disposable earnings of any individual for any workweek,
the 50 per centum specified in clause (A) shall be deemed to be 55 per
centum and the 60 per centum specified in clause (B) shall be deemed to
be 65 per centum, if and to the extent that such earnings are subject
to garnishment to enforce a support order with respect to a period
which is prior to the twelve week period which ends with the beginning
of such workweek."

(2) Compliance with the provisions of section 303(a) and (b) may
offer problems when there is more than one garnishment. In the event
that priority is determined by State law or other Federal laws as the
CCPA contains no provisions controlling the priorities of garnishments.
However, in no event may the amount of any individual's disposable
earnings which may be garnished exceed the percentages specified in
section 303. To illustrate:

(i) If 45% of an individual's disposable earnings were garnished
for taxes, and this garnishment has priority, the Consumer Credit
Protection Act permits garnishment for the support of any person of
only the difference between 45% and the applicable percentage (50 to
65%) in the above quoted section 303(b).

(ii) If 70% of an individual's disposable earnings were
garnished for taxes and/or a Title XIII Bankruptcy debt, and these
garnishments have priority, the Consumer Credit Protection Act does not
permit garnishment either for the support of any person or for other
debts.

(iii) If 25% of an individual's disposable earnings were
withheld pursuant to an ordinary garnishment which is subject to the
restrictions of section 303(a), and the garnishment has priority in
accordance with State law, the Consumer Credit Protection Act permits
the additional garnishment for the support of any person of only the
difference between 25% and the applicable percentage (50-65%) in the
above quoted section 303(b).

(iv) If 25% or more of an individual's disposable earnings were
withheld pursuant to a garnishment for support, and the support
garnishment has priority in accordance with State law, the Consumer
Credit Protection Act does not permit the withholding of any additional
amounts pursuant to an ordinary garnishment which is subject to the
restrictions of section 303(a).

[Codified to 29 C.F.R. § 870.11]

[Source: Section 870.11 added at 44 Fed. Reg. 30685, May 29,
1979]

Subpart CExemptions for State-Regulated
Garnishments

§ 870.50 General provision.

Section 305 of the CCPA
authorizes the Secretary to "exempt from the provisions of
section 303(a) garnishments issued
under the laws of any State if he determines that the laws of that
State provide restrictions on garnishment which are substantially
similar to those provided in section 303(a)."

[Codified to 29 C.F.R. § 870.50]

§ 870.51 Exemption policy.

(a) It is the policy of the Secretary of Labor to permit exemption
from section 303(a) of the CCPA garnishments issued under the laws of a
State if those laws considered together cover every case of garnishment
covered by the Act, and if those laws provide the same or greater
protection to individuals. Differences in text between the restrictions
of State laws and those in section 303(a) of the Act are not material
so long as the State laws provide the same or greater restrictions on
the garnishment of individuals' earnings.

(b) In determining whether State-regulated garnishments should be
exempted from section 303(a) of the CCPA, or whether such an exemption
should be terminated, the laws of the State shall be examined with
particular regard to the classes of persons and of transactions to
which they may apply; the formulas provided for determining the maximum
part of an individual's earnings which may be subject to garnishment;
restrictions on the application of the formulas; and with regard to
procedural burdens placed on the individual whose earnings are subject
to garnishment.

(c) Particular attention is directed to the fact that subsection
(a) of section 303, when considered with subsection (c) of that
section, is read as not requiring the raising of the subsection (a)
restrictions as affirmative defenses in garnishment proceedings.

[Codified to 29 C.F.R. § 870.51]

§ 870.52 Application for exemption of State-regulated
garnishments.

(a) An application for the exemption of garnishments issued under
the laws of a State may be made in duplicate by a duly authorized
representative of the State. The application shall be filed with the
Administrator of the Wage and Hour Division, Department of Labor,
Washington, D.C. 20210.

(b) Any application for exemption must be accompanied by two copies
of all the provisions of the State laws relating to the garnishment of
earnings, certified to be true and complete copies by the Attorney
General of the State. In addition, the application must be accompanied
by a statement, in duplicate, signed by the Attorney General of the
State, showing how the laws of the State satisfy the policy expressed
in § 870.51(a) and setting forth any other matters which the Attorney
General may wish to state concerning the application.

(c) Notice of the filing of an application for exemption shall be
published in the FEDERAL REGISTER. Copies of the application shall be
available for public inspection and copying during business hours at
the national office of the Wage and Hour Division and in the regional
office of the Wage and Hour Division in which the particular State is
located. Interested persons shall be afforded an opportunity to submit
written comments concerning the application of the State within a
period of time to be specified in the notice.

(a) The Administrator shall grant or deny within a reasonable time
any application for the exemption of State-regulated garnishments. The
State representative shall be notified in writing of the decision. In
the event of denial, a statement of the grounds for the denial shall be
made. To the extent feasible and appropriate, the Administrator may
afford to the State representative and to any other interested persons
an opportunity to submit orally or in writing data, views, and
arguments on the issue of whether or not an exemption should be granted
and on any subsidiary issues.

(b) If an application is denied, the State representative shall
have an opportunity to request reconsideration by the Administrator.
The request shall be made in writing. The Administrator shall permit
argument whenever the opportunity to do so has not been afforded under
paragraph (a) of this section, and may permit argument in any other
case.

(c) General notice of every exemption of State-regulated
garnishments and of its terms and conditions shall be given by
publication in the FEDERAL REGISTER.

[Codified to 29 C.F.R. § 870.53]

§ 870.54 Standards governing the granting of an
application for exemption.

The Administrator may grant any application for the exemption of
State-regulated garnishments whenever he finds that the laws of the
State satisfy the policy expressed in § 870.51(a).

[Codified to 29 C.F.R. § 870.54]

§ 870.55 Terms and conditions of every exemption.

(a) It shall be a condition of every exemption of State-regulated
garnishments that the State representative have the powers and duties
(1) to represent, and act on behalf of, the State in relation to the
Administrator and his representatives, with regard to any matter
relating to, or arising out of, the application, interpretation, and
enforcement of State laws regulating garnishment of earnings; (2) to
submit to the Administrator in duplicate and on a current basis, a
certified copy of every enactment by the State legislature affecting
any of those laws, and a certified copy of any decision in any case
involving any of those laws, made by the highest court of the State
which has jurisdiction to decide or review cases of its kind, if
properly presented to the court; and (3) to submit to the Administrator
any information relating to the enforcement of those laws, which the
Administrator may request.

(b) The Administrator may make any exemption subject to additional
terms and conditions which he may find appropriate to carry out the
purposes of section 303(a) of the
Act.

[Codified to 29 C.F.R. § 870.55]

§ 870.56 Termination of exemption.

(a) After notice and opportunity to be heard, the Administrator
shall terminate any exemption of State-regulated garnishments when he
finds that the laws of the State no longer satisfy the purpose of
section 303(a) of the Act of the policy expressed in § 870.51(a).
Also, after notice and opportunity to be heard, the Administrator may
terminate any exemption if he finds that any of its terms or conditions
have been violated.

(b) General notice of the termination of every exemption of
State-regulated garnishments shall be given by publication in the
FEDERAL REGISTER.

[Codified to 29 C.F.R. § 870.56]

§ 870.57 Exemptions.

Pursuant to section 305 of the
CCPA (82 Stat. 164) and in accordance with the provisions of this part,
it has been determined that the laws of the following States provide
restrictions on garnishment which are substantially similar to those
provided in section 303(a) of the
CCPA (82 Stat. 163); and that, therefore, garnishments issued under
those laws should be, and they hereby are, exempted from the provisions
of section 303(a) subject to the terms and conditions of
§§ 870.55(a) and 870.56:

(a) State of Virginia. Effective June 30, 1978,
garnishments issued under the laws of the State of Virginia are exempt
from the provisions of sections 303(a) and 303(b) of the CCPA under the
following additional conditions: (1) Whenever garnishments are ordered
in the State of Virginia which are not deemed to be governed by section
34-29 of the Code of Virginia, as amended, and the laws of another
State are applied, sections 303(a) and 303(b) of the CCPA shall apply
to such garnishments according to the provisions thereof; and (2)
whenever the earnings of any individual subject to garnishment are
withheld and a suspending or supersedeas bond is undertaken in the
course of an appeal from a lower court decision, sections 303(a) and
303(b) of the CCPA shall apply to the withholding of such earnings
under this procedure according to the provisions thereof.